Among the libertarian movement, it is a given that the Marxist idea of wage slavery is a sophism. In a truly free society, individuals would only enter into wage employment because they perceive benefit from it. That is, the employee and the employer only exchange if, ex ante, they expect to gain. Otherwise the exchange would simply not occur. So, all voluntary exchanges in a free (stateless) society are mutually beneficial.
However, in 2008 we do not live in a free society. There are governments that murder, steal, and enslave innocent people. They prevent voluntary interaction and impose coercive relationships. Suffice to say, the present conditions are not at all close to those of a free society. Then, given that we live in an unfree society, are employees the victims of wage slavery?
The answer must be no. Employees still voluntarily exchange their labor for wages, and they are not coerced into staying at their job. They have the freedom to leave and pursue other work. (Please note that I am not talking about sweatshops where workers are enslaved; such a case is criminal and unjust.)
But, some will object, workers are still in a tough spot. Just because we do not see a gun or a politician directly involved, does not mean that the situation is completely free. There could be indirect effects of government action that alter the worker/boss relationship from what it would be in a truly free society.
For example, a minimum wage causes unemployment. The result is workers not being able to find work. Or they might be out of work because of the jobs that never came into existence, which is caused by government restrictions on business and technology. Or they might be unable to start their own business due to myriad barriers to entry coercively imposed by government: permits, licenses, taxes, fees, mandates, building codes, zoning restrictions, etc. These are all cases where government action harms the worker.
But that’s not all. There is also, as Brad Spangler points out, “the role of the state in artificially concentrating capital in the hands of state-allied big business – giving statist plutocrats far more bargaining power in the labor market than is their natural due.” Thus, the boss typically has much more power than the average worker, something we can expect to be minimized with the abolition of government.
Essentially, this is just another case of “what is seen and what is not seen”, as Bastiat put it. We see a worker voluntarily entering into an exchange with an employer. As such, we conclude that it is perfectly legitimate. But we do not see the results of government action: the jobs that are never created, the increased bargaining power of employers, or the obstacles workers face in setting up their own business. Thus, the prosperity, innovations, and increases in quality of life that workers would experience in a free society are violently ripped away by government interference.
Clearly, there is a strong libertarian case that, in our unfree society, workers are oppressed, or at least maligned by the effects of the government. What can we call this phenomenon? I’ve already ruled out the term “wage slavery”. We know that employees are not coerced into working. I think a more appropriate term would be “wage exploitation”: to use workers selfishly for one’s own profit. And yet, I think that this term is also too strong. For it assumes that it is the employers who are causing the workers harm. But their actions are entirely just: trying to maximize profits. Reducing costs, including labor, to satisfy customers is a part of business. We cannot blame the employers for trying to make a living. (However, while the bosses’ actions are just, i.e. not a rights violation, they might not be virtuous.)
No, it is not the bosses, but the government that is the problem. This fact is central. It is the negative effects resulting from government action that cause the worker to be so powerless compared to the boss. Moreover, it would be absurd to expect employers to pay higher wages and give workers more bargaining power simply out of benevolence. And we all know what Adam Smith had to say about benevolence.
What, then, is the proper term for this phenomenon? To quote Brad Spangler again, he points out that the right term must be one “that doesn’t fail to distinguish between a completely free agreement and an agreement that has been shaped by a context of statist privilege granted to only one of the two parties” of the exchange.
The proper term for this wronging of workers is, I believe, “wage injustice”. Truly, the government action harming employees is unjust: after all, all government acts are, by necessity, criminal. Such acts must be funded and carried out by initiating violence against innocents. The term “wage injustice” lets us know that workers are the victims of criminal government interference in the market; it lets us know that workers, along with everyone else, will enjoy a much better life in a stateless society.
Thus, workers are the victims of injustice – an injustice that is not the fault of employers, but of government. An injustice that would be righted by abolishing the government and allowing a free society to emerge.
